Rob Portman : Portman Questions Treasury Nominee on Bringing Back Jobs from Overseas, Fighting Unfair Imports

WASHINGTON, D.C - U.S. Senator Rob Portman (R-OH) questioned President-Elect Donald Trump's nominee to be Secretary of the Treasury at his confirmation hearing today. Portman focused his questions on several Portman priorities: fixing our broken tax code to bring jobs and investment back from overseas, fighting back against the unfair trade practices of other countries, and reforming a broken IRS.

A transcript of the exchange can be found below and a full video can be found here.

Senator Portman: 'Thank you, Mr. Chairman. And Mr. Mnuchin, thank you for being here. But I think it's your kids who deserve the award for stamina. My kids at that age would have been long gone, so whatever you have done, you've done a good job.'

Mnuchin: 'I told them that they could leave after an hour, but they actually opted to stay.'

Portman: 'Well, good for you guys. Listen, I think you're right about the fact that the tax code is an opportunity for us to help give the economy a shot in the arm. And, just to put a finer point on it, median income has not gone up when you look back at the pre-recession levels. And that's the middle-class squeeze-that, and the higher expenses, including health care. And then in terms of unemployment, you're right: if you go back to the labor force participation rate that was in effect at about 66 percent before the recession, and you compare it to today, unemployment would be about 9.5 percent. So this economy is not humming; we're not doing great, and we're not serving middle-class families who are struggling to make ends meet. And I think tax reform is one way within your purview that you can make a big difference there. And I appreciate what you said in response to Senator Scott on that because I do think we should be focusing on wages and not just overall economic growth but how to ensure that we're creating opportunities for the families we represent. One thing you didn't talk about-at least I didn't hear you when I was here-is on the business side, repatriation. You can lower the rate-and I think that's important, having the highest rate in the world-but don't you think there's an opportunity to repatriate some of those profits that are now locked in overseas? And the number I hear is over $2 trillion. What is the number you believe and what can be done to bring that money back here to invest in jobs and plants and equipment?'

Mnuchin: 'Well, I can tell you the President-Elect thinks that we're going to get over $3 trillion. His number is three to four trillion dollars. We're going to get a lot of money back. I've spoken to several CEOs who want to bring money back. So to the extent that we create a one-time repatriation in the Trump plan-we have put that at 10 percent; I think in the House GOP plan they had that slightly lower-but I absolutely believe-and I've heard CEOs say this and some of them are, without naming names, some of the biggest holders of cash abroad-absolutely want to do it and we're committed to that.'

Portman: 'So you're committed to working with us to be sure that we can do that.'

Mnuchin: 'Absolutely.'

Portman: 'This has bipartisan support here, and we need to invest those funds back here, including for things like infrastructure. With regard to trade, there's been some discussion I've heard on trade. And as you know, I believe in expanding exports; I'm a former U.S. Trade Rep and I think we're not doing enough there. But I also believe in a level playing field. And one area that we've had a lot of contention is on currency manipulation. We tried in the legislation called Trade Promotion Authority to get that done-Senator Stabenow and I actually introduced an amendment which came close but we didn't quite get done to make it a trade objective in our trade negotiations. But we did pass something in the customs bill that directly relates to your job. It says that Treasury has enhanced authority to take action on this. There are some conditions that have to be met that, frankly, trade manipulators will meet and at the end of the day, if the country fails to change its policies, the Treasury Secretary can recommend the president take action, such as prohibiting the federal government from procuring goods or services from that country, calling for formal consultations on findings of currency manipulation at the IMF-International Monetary Fund. If confirmed, would you commit today to take full advantage of enhanced authority we've given the Department?'

Mnuchin: 'Absolutely, I think that's very important. And in particular I just want to point out and thank you. I know you've taken the opportunity to meet with me several times-and I enjoyed our working lunch yesterday in your office-and we've talked a lot about these issues, and I'm absolutely committed to work with you on this and this sounds like a very important issue.'

Portman: 'Again, I think it's one where there's some bipartisan agreement about the need to address currently manipulation and I appreciate your commitment to use the authority we've given you and work with us on other authorities.

'Another topic I wanted to touch on was the IRS. I understand there was some discussion when I had to step out to another hearing regarding funding for the IRS. I heard what Senator Burr said about some of the examples of IRS poor management, including promotion policies. Obviously we know that there were politics involved at the IRS and that they were making decisions based on political matters-which is totally inappropriate for a tax collection agency. So the IRS has created huge problems by the way it has not performed in a way that anybody would expect as a taxpayer. On the other hand, by understaffing and underfunding the IRS, taxpayer service has been eroded, and that affects my constituents in very direct ways. Are you committed to trying to fix these problems at the IRS but also working with us to ensure that there's adequate funding and support so that the tax system can work better, hopefully under a very simplified tax code?'

Mnuchin: 'Absolutely. And this is something I feel very strongly about and it's something that I hope we do have bipartisan support on, because this is one of the areas where I think we'll all agree to the extent that we add resources we can collect more money. One of the things I've heard is one of the reasons why we have technology problems is because, based upon the guidelines, we can't afford to hire technology people internally. While I think there's some external technology, we need to have internal expertise in the IRS to manage our own technology systems and, I think in this day and age, like any other entity, we need to have good customer service. If people are paying taxes they have the right to get the information; they have the right to understand the information. We should be able to interact electronically and securely, keep people's information safe. I can go on and look at my real estate tax bills in California and see my information there. I don't see why we don't have good systems that people who pay taxes can see their information securely online. So I look forward to working with you and I also think that we should be monitoring customer satisfaction, like anything else. We should understand what the taxpayers think of the service we provide them.'

Portman: 'I know that my time is up, Mr. Chairman. The chair and ranking member, I would assert, agree with me on this, but additional focus on the IRS is an opportunity for us. Nineteen years ago there was this reform effort. I co-chaired it with Bob Kerrey who was a Senator at the time; I was a House Member. Every 20 years it probably ought to be looked at, including the technology. So this is an opportunity. I appreciate your comments and I appreciate your being here today, Mr. Mnuchin.'

Mnuchin: 'Thank you and I look forward to working with you on it.'

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